Giving pink slips (titles) as collateral?

[rocket]

I've never thought about this before nor do i know how how good it would be to give someone your vehicle title as collateral for buying (making payments) on another private sale vehicle from them.

Would a title even be considered worth anything in the hands of someone else? I suppose they could forge my signature on the title but i'm wondering if them just having it would be enough to use against me if i defaulted on payments? The more i think about this (while typing), is that i could just go to DMV and file for a lost title. So using it as collateral is probably useless for the seller.
Is there another way to use vehicle title(s) in a legal way as collateral for payment?

[MTL_4runner]

Just getting the piece of paper itself is worthless, but it can be used to register a lien against the vehicle (for the amount being loaned) at the DMV. Obviously a when properly signed title will allow you to transfer ownership of the vehicle completely. You'll see any lien registrants printed on any future titles until the lien is released by signing (banks do this all the time). This (DMV liens or more often signing over ownership completely) is usually how those payday loan operations work when you ask for a loan using a vehicle as collateral.

[Texas Jim]

I take titles as collateral in Bail bonding. I use the title as collateral against the parties bond. I also take possession of the car, or truck while it is pending, they also sign the title, transferring the car or truck to me. If it is worth any money if it isn't I usually don't want it, (ie $300 piece of crap) which is ofthen what people want to put up. TJ

[BruceTS]

I've never thought about this before nor do i know how how good it would be to give someone your vehicle title as collateral for buying (making payments) on another private sale vehicle from them.

Is there another way to use vehicle title(s) in a legal way as collateral for payment?


The legal way to do the transaction is have him as the lien holder when you go to transfer the vehicle, he gets the title, but you will get the registration, until all payments are made. I would not give another vehicle title as collateral......